“I love being big-timed.” – No one, ever.
Inspired by Christine Tsai’s post called, “8 Tricks to Appear Like An Important VC,” we thought it would be amusing, and therapeutic, to take a swing (pun intended) at private equity. Here goes something…
1. Start every relationship by comparing size.
When you meet someone who says they work in private equity, immediately ask, “What’s your AUM?” When you meet an intermediary, immediately ask, “What was the size of your last transaction?” After getting the number, quickly determine whether a conversation is merited. If not, start looking past them. They’ll get the message.
2. Look like you’re rolling in money.
Wear expensive suits and watches. Stay only in five-star hotels. Always request specific and expensive drinks. Nothing says that you’re financially responsible like showing you know how to spend large sums of money.
3. Always be about to go on, or have recently been on an exotic vacation.
People will know you’re something if you casually mention spending tens of thousands of dollars to get away from life. It’s no big deal, right? Remember to use these vacations as an ongoing excuse to reschedule, cancel or refuse to take meetings. Arrive to every board meeting as tan as you possibly can manage. Don’t forget to fake bake if necessary.
4. Talk about portfolio companies as though they are inanimate objects that employ no one.
As a private equity professional, you must solely be focused on financial returns. When you talk about people, you sound soft. Companies should solely be viewed as cash-generating machines. And if they are not generating enough cash, they should be cast off. In fact, you’ve considered approaching ABC about your own show called, “PE Island: No Job Is Safe.”
5. Take at least a full week to respond to email.
It’s not that you’re disorganized, lazy, or inconsiderate, you’re just too busy to be available. Right?
6. Use jargon and formulas whenever possible.
“Can we use a lockbox for this recap?” “Did your fund’s RVPI multiple follow a traditional J-curve?” “Our last brownfield was a real club deal.” You paid for the MBA. You might as well make sure people know that you have it. Remember that clarity is for commoners.
7. Talk about wealthy families as though you’re their sole heir.
You know the “Smith Family” from California and the “Joneses of New York.” Dropping their names in conversation boosts your credibility and shows you’re connected. If you really want to make an impression, you mention Bill’s embarrassing slice, or that you can’t believe Joan took her G6 to Europe last weekend.
8. Don’t reference real life.
Private equity is not the real world. You cannot be distracted by chores, car repairs, or, heaven forbid, sick children. Bringing up such topics is bound to make others question whether you are really serious about your work.
9. Make every interaction serious, boring and, well, ugly.
Any document you send out should look like it came from a lawyer or an accountant. Make no effort to make things attractive. Use logos made in the last century, and clip art, Powerpoint graphs, and stock photography wherever imagery is needed. Be as verbose as you can, and always remember to include confidentiality clauses in all communication. Never, ever bother to update your website. Remember, you’re busy.
10. Be old at heart.
Regardless of your age, acquire the tastes and habits of old men. Complain about digital publications, because serious business people read the print version of the Wall Street Journal. Mention that your assistant handles your email. Drink single malt scotch. Cheers.
Based on the fact that we came up with a few more digs than Christine, is it possible that PE is more important than VC? Of course.